The mammalian heart forms early in embryogenesis, and defects in its formation are at the root of congenital heart defects (CHDs), affecting 1-2% of live births. In adults, heart disease is the number one killer in the Western world, resulting in a considerable health burden. Understanding the building blocks of the heart is critical to define the etiology of CHDs and to create novel cell-based regeneration strategies to treat heart disease. Identifying and isolating cardiac precursors from pluripotent cells would allow characterization and expansion of cardiac cells for regenerative strategies. We identified expression of Smarcd3 (also known as Baf60c) as a candidate early marker of a prespecified mesoderm population that gives rise predominantly to cells of the developing heart. Using transgenic reporter assays and inducible Cre-mediated lineage tracing, we showed early expression of Smarcd3 in anterior mesoderm of the mouse is a specific marker of the earliest specified cardiac precursors, preceding expression of any other cardiac precursor marker. We hypothesize that Smarcd3 marks the earliest specific cardiac progenitors in the mouse embryo, and that this specialized mesodermal population has distinct properties that lead to preferential differentiation into cardiomyocytes. We will test this hypothesis in three Specific Aims. Aim 1: To define the early cardiac lineage marked by Smarcd3 expression. Using transgenic reporter lines, we will delineate the relationship between the Smarcd3 lineage and previously characterized cardiac lineages. We will use inducible Cre labeling, combined with multicolor rainbow reporter mice to define the early Smarcd3 lineage and the clonal relationships between its descendents. Using fluorescent reporter transgenic mouse lines, we will purify Smarcd3-expressing progenitors Aim 2. To determine the transcriptional and signaling pathways that activate early Smarcd3 expression. In this aim, we will define the genetic and signaling inputs that direct Smarcd3 expression in early cardiac progenitors. We will use transient transgenesis in mouse and differentiating ES cells to define the transcriptional inputs that activate Smarcd3 expression. Using transgenic ES cells expressing EGFP under control of the Smarcd3 regulatory region, we will identify the sets of signaling inputs that direct activation of Smarcd3 in this early population of cardiac precursors. Aim 3: To define signaling pathways that lead to cardiac differentiation of the early cardiac lineage. We will determine the importance of BMP and Wnt signaling in the differentiation of cardiac tissue from embryonic mesoderm, as well as the temporal requirement for these pathways. The results will be critical to understand the inductive cues required for cardiac differentiation. The knowledge generated from this study will be crucial to our understanding of the earliest fate decisions that lead to the formation of te heart.